
In 2025, Nigeria™s M&A market is at an intersection of
forces, as regulatory requirements, economic restructuring, and industrial
consolidation converge in what will be the largest economy on the continent.
With more than 220 million people and a GDP above $ 440 billion, Nigeria is Africa™s most populous country, and its economy is also the largest; but beyond
the local opportunity, Nigeria offers access to the bigger West African
Economic and Monetary Union (WAEMU) market of over 400 million consumers.
The country™s financial services grew by 30% in 2004 as a
result of 6 billion dollars of foreign investment, which opened the way to
unprecedented merger and acquisition activity in various industries. Combined
with the Central Bank of Nigeria™s stringent recapitalization policies, this
path of growth has led to a flurry of predicted strategic mergers, which many
say will change Nigeria™s corporate landscape in the next three years.
This convergence point of corporate acquisitions in Nigeria highlights an intriguing story: business consolidation in Nigeria is not an impending threat but a revitalizing trend. There are now players leading the game, especially local companies, as the global giants relocate onshore assets and take advantage of such shifts to increase their local presence.
Oil & Gas: The Powerhouse Segment of Nigerian Investment Deals
Shell to Renaissance Consortium “ $2.4B Deal
The 2024 megaproject: a group of five indigenized oil
companies (ND Western, Aradel, Petrolin, First E&P, Waltersmith) purchased
Shell™s onshore SPDC holdings for an upfront $2.4 billion and $1.1 billion
deferred, a total of $2.8 billion. December 2024 is the date of final approval.
After a long wait for regulatory approval, the eventual go-ahead showed a
revived potential for cross-border M&A in Nigeria.
TotalEnergies Stake Selloff “ $860M
In July 2024, Chappal Energies purchased TotalEnergies' 10% interest in the SPDC™s JV- an 860 million dollar transaction that gave them 18
crude and gas licenses. This, in turn, made the JV wholly Nigeria-owned, and
part of a larger trend toward Nigerian private equity ownership.
Exxon to Seplat “ $800M
Exxon Mobil™s onshore business unit sale to Seplat was
completed in December 2024 for $800 million and is in line with the
government™s desire to open up the financial sector M&A for local investors
while still maintaining offshore operations as an attractive option for IOCs.
Oando™s NAOC Acquisition “ $783M
Oando™s purchase of Eni™s NAOC in August 2024, for $783
million, was awarded the "Deal of the Year" and is significant
because it represents major growth in corporate acquisitions in Nigeria in the
indigenous oil sector.
Equinor Exit “ $1.2B
Equinor™s exit after three decades, divesting its interest
in Agbami to Chappal Energies for $1.2 billion, reaffirms the trend of IOCs
leaving and Nigerian companies emerging in the consolidation of business in Nigeria.
Beyond Oil & Gas: Diversifying Sectors & M&A Strategy Nigeria
Banking Consolidation
In response to Central Bank re-capitalizations, the August
2024 Unity Bank- Providus bank merger was supported by a ₦700 billion CBN
facility, which was the first time there had been mergers in the banking sector
in the previous five years. Meanwhile, FBN Holdings sold its merchant bank,
FBNQuest, to EverQuest Acquisition LLP, for which ₦465 billion worth of assets
were utilized in the sales transaction.
These actions highlight the fact that the trend in M&A
in Nigeria now is for M&A in the financial sector, as financial sector
consolidation leads to financial robustness.
Fintech & Tech: Innovation-Led M&A
Nigeria™s digital economy is driving new activity. Interswitch-M-Kudi
will likely merge the provide digital payments for rural clusters. Indeed,
Moniepoint™s $110 million Series C raising from Google Africa and Verod, which
also led to the company achieving unicorn status, illustrates the clout of
Nigerian funding rounds within the fintech space.
Consumer & Agri: Local Takes Over
In June 2024, Tolaram purchased Diageo™s 58% share of
Guinness Nigeria for ₦104 billion (~$248 million).
Saroafrica International simultaneously gained controlling
interests in Presco Plc (~$125¯million transaction) and, via Oak and Saffron
SPV, began its regional expansion by placing a bid for GOPDC in Ghana.
Agribusiness & Others
Saudi SALIC™s $1.24 billion investment for a 35% stake in
Olam Agri is a clear indication of the state of agricultural cross-border
M&A in Nigeria. Several tech/energy/fabric combinations were also approved
in 2024.
Regulatory & Capital-Raising Context
As the spectrum has been expanded to most industries, the
SEC has also not halted M&A deals in 2024, where 11 deals worth 320 billion
N (~420M USD), of which the Guinness Nigeria deal was a part.
- Nigeria™s capital markets were thriving: a total of ₦3.68
trillion was raised in 2024 (₦59.8 billion was fixed income while ₦3.62
trillion was for equities), and ₦446 billion was filed for in early 2025.
- A larger recapitalization drive: led to mergers and
acquisitions in the banking industry, as the CBN announced it would require
significant capital by March 2026.
- Electronic regulation: the SEC and FCCPC became more
stringent, embarking on a path of examining corporate acquisitions in Nigeria
in the telecoms, food & beverages, and tech sectors in order to protect
competition.
Applying M&A in Your Business Strategy
If you are a strategic or financial buyer/investor, or
advisor looking to find deals to invest in Nigeria, these are some steps you
can consider taking:
1. Market & target screening: make use of sophisticated
data analytics to isolate targets with high earning potential, sustainable
business models, and clear avenues for expansion.
2. Regional comps Valuation: based on comparable deals in
Nigeria and other markets (Kenya, South Africa) while factoring for country
risk, industry characteristics and capital structure.
3. Deal structuring innovation: Matching local currency
restrictions, tax positioning, repatriation policies, and exit preferences
through the incorporation of earn-outs, convertible characteristics, and
tranches in foreign currency.
4. Innovations around deal structuring: in alignment with local
currency restrictions, taxation, repatriation, and exit, also use earn-outs,
conversion options, and foreign currency tranches.
5. Integration blueprinting: Work out the goals of the merger
in advance, and bring together leaders of both organizations to jointly develop
the plans for the merger to take place in the areas of tech, human resources,
marketing, and operations.
6. Ongoing stakeholder outreach: mobilize regulators, voices in
the community, and consumer advocacy groups, particularly on mergers and
acquisitions that have a systemic effect, such as with banks or energy, to
build confidence and diminish lags.
Key Trends in M&A Strategy in Nigeria
Indigenization of Assets: As Shell, Exxon, TotalEnergies,
Eni, and Equinor have all publicly departed from onshore operations, domestic
companies are capitalizing on the opportunity to increase control of the
upstream through consolidation in Nigeria.
- Regulatory Consolidations Capital requirements: within the
banking system, particularly, are forcing institutions to merge or spin-off to reach size and compliance with regulations.
- Sectoral Diversification: The continued dominance of energy
is somewhat counterbalanced by the emergence of activity in sectors such as
fintech, agriculture, consumer goods, and renewable energy, all pointing to a
more diversified economic ecosystem.
- Cross Border Intentions: As exhibited in Access Bank™s
Ugandan and South African expansion, and Oando™s mobilization in the energy
sector, Nigerian™s Nigeria™s M&A strategy is starting to be taken beyond
its borders.
- Private Equity & Growth Capital: Significant growth
rounds such as Moniepoint and Olam Agri highlight the role of Nigerian private
equity in these digital and agribusiness scale-ups.
- Changing Regulations: The SEC, FCCPC, CBN, and CAMA 2020
have created new approaches to how Mergers and Acquisitions in Nigeria should
be viewed, as the firms must now comply with issues regarding approval to
competition, funding, and shareholder issues.
Conclusion
The landscape of the Nigerian M&A market is changing.
The local mega acquisitions, bank mergers, and the center of the fintech industry are changing the picture, where the amount of deals is at a decade high.
Main takeaways:
Energy exit = Local entry: International oil firms are
exiting onshore, while Nigerian companies are entering, consolidating business
in Nigeria.
- Regulatory congruence as a motive for scale: CBN, SEC, and
FCCPC moves are guiding consolidation into stronger, more compliant entities.
- Digital finance and agribusiness diversification: Aside from
oil & gas, Nigeria™s M&A plans are based on tech, fintech, agriculture,
and renewable energy.
- Capital markets driving the momentum: Equities and debt
placements remain financing for growth, both locally and regionally.
- Cross-border visions: as Nigerian firms are starting to
expand their footprints, both financially and operationally, in the rest of
Africa, defining what a true market entry in Nigeria means.
But, the Nigerian M&A story is not one filled only with
transactions that make the headlines, it is one of ownership transfer,
regulatory advancements and strategic reshaping. As the previous era of
cross-border transactions transitions into one led by Nigerian private equity
firms with Nigerian M&As in a sector-diversifying Nigeria, one that will,
finally, cross the jargon and cliché-laden Rubicon into a sustainable future.
Thus, mergers & acquisitions in Nigeria today are transactions in which the
exchange is not financial; rather, they are trajectories of business
transformation, influenced by the agency of local actors, the regulatory system
in place, and the larger economic and developmental architecture that is being
created.